American Realty to Buy U.S. Buildings for $416.5 Million
American Realty Capital Properties Inc. (ARCP) agreed to buy 40 buildings for $416.5 million, extending a string of acquisitions of single-tenant real estate.
The properties, in 20 states and net-leased to 26 tenants, will be purchased at an 8.8 percent average capitalization rate, the New York-based real estate investment trust said today in a statement. The transaction allows the REIT to meet its previously announced goal of $1.1 billion in acquisitions for the second half of 2013, according to the company.
“We continue to identify a balance of long-term and mid-term leases for our portfolio and properties which enhance diversity, decrease tenant and industry concentration and further fortify our net-lease portfolio with rents that are highly accretive to our dividend,” Nicholas Schorsch, chief executive officer of American Realty Capital Properties, said in the statement.
Schorsch has been on a buying spree as he seeks to build American Realty Capital Properties into one of the country’s largest single-tenant landlords. Last month, the company agreed to buy American Realty Capital Trust IV, a nonlisted real estate investment trust under the same management company, in a deal valued at $3.1 billion. American Realty Capital Properties in May agreed to acquire CapLease Inc. (LSE) for $2.2 billion, including debt and completed the purchase of 447 properties in June.
Net-lease landlords rent buildings to one tenant, with occupants paying such expenses as maintenance costs and property taxes. The board of American Realty Capital Properties approved the $416.5 million acquisition in two portions on Aug. 2 and Aug. 5, according to today’s statement. Sellers weren’t disclosed.
The entire $1.1 billion in properties will be purchased at an average capitalization rate of 8 percent, according to the company. Cap rates, a measure of investment yield, are net operating income divided by purchase price.
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